Cheers and some wary eyes greet new frax regs

In the first few days after the new FAR on fractional ownership hit the street last month, the aviation community was reacting with tempered optimism. While many praised the cooperative effort between the FAA and the Fractional Ownership Aviation Rulemaking Committee (FOARC) in creating the long-awaited final rule, they also reserved substantive comment until they had further time to analyze the result.

A proposal to relax the runway landing requirements for on-demand Part 135 operators from 60 percent of the available runway length to 85 percent became a casualty of the FAA’s final rulemaking. The agency not only denied that proposal but also stiffened the requirements for fractional operators to the same 60 percent, thus eliminating access to some airports that were heretofore legal for some aircraft types. The FAA argued that the deficiencies in predicting landing performance that inspired the original landing-distance margin in the 1930s have still not been rectified.

The notice of proposed rulemaking (NPRM) that came out of the FOARC postulated that a reduced margin would allow a substantial expansion of opportunities for on-demand operators, particularly at airports with a single, short runway. “The FAA does not believe that the effect would be as large as the NPRM suggests,” it commented. “Although it depends on the specific airplane’s performance capabilities, the takeoff-distance requirements usually are more limiting than the landing-distance requirements, even under the ‘60-percent rule.’”

But the final rule modifies the 85-percent proposal. Fractional-ownership program managers and eligible on-demand operators can apply for approval to plan for a full-stop landing at the intended destination airport within 80 percent of the effective length of the runway if the program manager or certificate holder has an approved destination airport analysis in its operations manual.

Generally referred to as Part 91 Subpart K, the rule has been in the making for four years, almost to the day. Former FAA Administrator Jane Garvey convened the special aviation rulemaking committee on Oct. 6, 1999. The final rule was published on September 17 and becomes effective November 17. However, fractional operations already in existence before that date have until December 17 next year to show compliance.

Jim Christiansen, chairman of the FOARC and now chairman of the National Air Transportation Association’s Fractional Aircraft Business Council, told AIN, “We are pleased that the rule has finally been published and we think it is a great step forward.” Acknowledging that there are some changes in the rule compared with what the group submitted in 2000 as the basis for an NPRM, he added that the committee needs to analyze the effect of those changes.

While the rule “is not completely what NBAA expected,” NBAA president Shelley Longmuir noted that “traditional Part 91 flight departments are unaffected by Subpart K.”

Commenting on the new rule, NetJets called it “a great step forward,” while taking note of the changes between the FOARC recommendations and the final rule. The company said in a statement that, after analysis, “we will be delighted to discuss it.”

In establishing Subpart K to cover fractional-ownership operations, the final rule clarifies what qualifies as a fractional-ownership program; clarifies who has operational control; defines operational-control responsibilities; codifies many of the “best practices” now being used voluntarily in fractional-ownership programs; and incorporates many of the safety standards of Part 121 and Part 135.

According to the FAA, this rulemaking establishes safety standards to maintain the excellent safety record of current fractional- ownership programs and to ensure that new fractional-ownership programs will also meet a high level of safety. It also establishes the criteria for qualifying as a fractional-ownership program; explains that fractional owners and the management company share operational control of the aircraft and delineates operational control responsibilities; and defines regulatory safety standards for operations under fractional-ownership programs, including management operations, maintenance, training, crewmember flight and duty requirements and others.

Many of the requirements in Subpart K are based on requirements for on-demand operations in Part 135, and several of those were revised in the rulemaking to help level the playing field between the strictly commercial operators and the noncommercial fractional providers.

This seeming dichotomy between noncommercial, but profit-making, fractional providers and commercial, strictly-for-profit on-demand operators has raised some red flags in Europe. While the FAA considers the operations by fractional providers to be non-commercial for regulatory purposes, the UK contends the opposite because money is changing hands between the fractional providers and their fractional aircraft owners.

The General Aviation Manufacturers Association (GAMA) said the most positive aspect of the new rule is that it recognizes fractional programs as private rather than commercial operations. The UK argued that the proposal appears to be contrary to the provisions of the Chicago Convention, which defines a commercial operation as transporting passengers, cargo or mail for remuneration. The French aviation authority submitted a similar comment. An FAA spokesman said the agency expects to address the issue in upcoming negotiations with the UK’s Civil Aviation Authority.

In the process of reviewing Part 135 requirements, the FOARC and the FAA determined that some of the current Part 135 requirements needed to be updated in accordance with new technology and other changes. The committee studied the best practices of the fractional-ownership programs to determine under what circumstances Part 135 operations could use those practices as an alternate means of compliance with Part 135 standards.

In addition, proving-test requirements for both fractional-ownership programs and Part 135 on-demand operations were reviewed and amended. A proving-test requirement was added for fractional-ownership programs and the requirement for multiple proving tests for Part 135 operations was amended.

The FAA also made some changes in the proposed flight, duty and rest time requirements for all pilots operating fractional aircraft, which had been supported by NBAA, NATA and Flexjet. Currently, fractional-ownership operations have no regulatory flight, duty and rest requirements.

The FAA said the requirements of the final rule will apply standards comparable to those used in on-demand operations, and go beyond those standards in specific areas, such as in applying time-zone restrictions.

In addition, the agency said it will monitor implementation of the rules and might introduce future rulemaking, “particularly at the time that the agency develops proposed revisions to flight, duty and rest requirements for Part 121 and 135 operations.”

While calling the final Subpart K an important milestone in the evolution of business aviation, GAMA and NATA admitted that its enthusiasm for the new rule was tempered by the restrictions on fractional programs in areas related to required runway lengths and aircrew flight and duty times, which both differed from the rule the FAA initially proposed in 2001. The associations are continuing their technical review of the rule.